Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Long-term Activity Ratios (Summary)
DexCom Inc., long-term (investment) activity ratios
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio exhibits a consistent downward trend from 2018 through 2022. Starting at 5.63 in 2018, the ratio declines progressively each year to reach 2.76 by the end of 2022. This suggests a decreasing efficiency in generating revenue from net fixed assets over the period.
- Net Fixed Asset Turnover Including Operating Lease, Right-of-Use Asset
- This adjusted measure shows a similar declining pattern, beginning at 5.63 in 2018 and decreasing each year to 2.56 in 2022. The rates are generally lower than the unadjusted net fixed asset turnover from 2019 onward, indicating the impact of capitalizing operating leases on asset efficiency assessment.
- Total Asset Turnover
- The total asset turnover ratio demonstrates some fluctuation. The ratio increases from 0.54 in 2018 to 0.62 in 2019, then sharply declines to 0.45 in 2020. Thereafter, it recovers to 0.50 in 2021 and further improves to 0.54 in 2022, returning to the initial level recorded in 2018. This pattern may reflect varying utilization of all assets in generating revenue, with some cyclical or operational factors affecting the efficiency.
- Equity Turnover
- Equity turnover shows an initial increase from 1.56 in 2018 to 1.67 in 2019, followed by a significant decline to 1.05 in 2020. Modest increases occur in subsequent years, reaching 1.36 by the end of 2022. Although this ratio does not return to the 2019 peak, the upward trend in the latter years suggests some recovery in how effectively equity is employed to generate sales.
Net Fixed Asset Turnover
DexCom Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 2,909,800) | 2,448,500) | 1,926,700) | 1,476,000) | 1,031,600) | |
| Property and equipment, net | 1,055,600) | 801,800) | 515,300) | 321,300) | 183,100) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 2.76 | 3.05 | 3.74 | 4.59 | 5.63 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Abbott Laboratories | 4.76 | 4.81 | 3.83 | — | — | |
| CVS Health Corp. | 24.98 | 22.56 | 21.25 | — | — | |
| Elevance Health Inc. | 36.07 | 34.94 | 34.69 | — | — | |
| Intuitive Surgical Inc. | 2.62 | 3.04 | 2.76 | — | — | |
| Medtronic PLC | 5.85 | 5.77 | 5.99 | — | — | |
| UnitedHealth Group Inc. | 31.81 | 31.81 | 29.64 | — | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Health Care Equipment & Services | 19.90 | 18.93 | 17.74 | — | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Health Care | 9.32 | 9.09 | 8.34 | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Net fixed asset turnover = Revenue ÷ Property and equipment, net
= 2,909,800 ÷ 1,055,600 = 2.76
2 Click competitor name to see calculations.
- Revenue Trend
- Revenue shows a consistent and strong upward trajectory over the five-year period analyzed. Starting at 1,031,600 thousand US dollars in 2018, it increases significantly each year, reaching 2,909,800 thousand US dollars by 2022. The growth suggests robust business expansion and an increasing market presence.
- Property and Equipment, Net
- The net value of property and equipment also exhibits marked growth, rising from 183,100 thousand US dollars in 2018 to 1,055,600 thousand US dollars in 2022. This indicates substantial investments in fixed assets, likely reflecting capacity expansion, modernization, or technological enhancement.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio declines steadily from 5.63 in 2018 to 2.76 in 2022. This downward trend suggests that while revenue has increased, it has not kept pace proportionally with the growth in net fixed assets. The decreasing ratio may indicate that the company is accumulating fixed assets faster than generating incremental revenue from them, which could point to underutilization or a lag in achieving operational efficiencies related to recent investments.
- Overall Insights
- The data reflects vigorous revenue growth accompanied by heavy investment in property and equipment. Despite the growing asset base, the declining net fixed asset turnover ratio implies that the efficiency in using these assets to generate revenue is decreasing. This pattern often occurs during periods of rapid expansion and capital expenditure, before the benefits of such investments are fully realized in operational performance.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
DexCom Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 2,909,800) | 2,448,500) | 1,926,700) | 1,476,000) | 1,031,600) | |
| Property and equipment, net | 1,055,600) | 801,800) | 515,300) | 321,300) | 183,100) | |
| Operating lease right-of-use assets | 80,000) | 88,100) | 93,300) | 71,500) | —) | |
| Property and equipment, net (including operating lease, right-of-use asset) | 1,135,600) | 889,900) | 608,600) | 392,800) | 183,100) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 2.56 | 2.75 | 3.17 | 3.76 | 5.63 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Abbott Laboratories | 4.25 | 4.26 | 3.42 | — | — | |
| CVS Health Corp. | 10.46 | 9.09 | 8.04 | — | — | |
| Elevance Health Inc. | 31.64 | 30.12 | 29.26 | — | — | |
| Intuitive Surgical Inc. | 2.53 | 2.93 | 2.66 | — | — | |
| Medtronic PLC | 5.06 | 4.84 | 5.02 | — | — | |
| UnitedHealth Group Inc. | 21.54 | 21.54 | 19.55 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Health Care Equipment & Services | 12.65 | 11.63 | 10.46 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Health Care | 7.48 | 7.17 | 6.51 | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenue ÷ Property and equipment, net (including operating lease, right-of-use asset)
= 2,909,800 ÷ 1,135,600 = 2.56
2 Click competitor name to see calculations.
- Revenue
- The revenue demonstrates a consistent upward trend over the five-year period. Starting at approximately $1.03 billion in 2018, it increased significantly each year, reaching nearly $2.91 billion by the end of 2022. This indicates strong growth in sales or service delivery, with the year-over-year percentage increase varying but generally reflecting robust expansion.
- Property and Equipment, Net
- The net value of property and equipment, including operating lease right-of-use assets, also shows a marked upward trajectory. It more than doubled from about $183.1 million in 2018 to $393 million in 2019 and then continued to increase steadily, achieving $1.14 billion in 2022. This trend suggests substantial capital investments and asset acquisitions over the period.
- Net Fixed Asset Turnover Ratio
- There is a noticeable decline in the net fixed asset turnover ratio throughout the period. Beginning at 5.63 in 2018, the ratio decreases each year, falling to 2.56 by 2022. This decline implies that the efficiency with which fixed assets generate revenue has diminished. A potential interpretation is that while assets have increased significantly, revenue growth, although strong, has not kept pace proportionally with asset expansion, resulting in lower turnover efficiency.
- Overall Insights
- The combination of steadily increasing revenue and rapidly growing assets highlights an aggressive expansion strategy, possibly through capital expenditure and leasing arrangements. However, the declining asset turnover suggests that asset utilization efficiency is reducing. Management may need to focus on optimizing asset use to enhance operational efficiency and support sustained revenue growth in the future.
Total Asset Turnover
DexCom Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 2,909,800) | 2,448,500) | 1,926,700) | 1,476,000) | 1,031,600) | |
| Total assets | 5,391,700) | 4,863,600) | 4,290,500) | 2,395,000) | 1,916,000) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.54 | 0.50 | 0.45 | 0.62 | 0.54 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Abbott Laboratories | 0.59 | 0.57 | 0.48 | — | — | |
| CVS Health Corp. | 1.41 | 1.25 | 1.16 | — | — | |
| Elevance Health Inc. | 1.51 | 1.41 | 1.39 | — | — | |
| Intuitive Surgical Inc. | 0.48 | 0.42 | 0.39 | — | — | |
| Medtronic PLC | 0.35 | 0.32 | 0.32 | — | — | |
| UnitedHealth Group Inc. | 1.31 | 1.34 | 1.30 | — | — | |
| Total Asset Turnover, Sector | ||||||
| Health Care Equipment & Services | 1.17 | 1.09 | 1.03 | — | — | |
| Total Asset Turnover, Industry | ||||||
| Health Care | 0.75 | 0.70 | 0.64 | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Total asset turnover = Revenue ÷ Total assets
= 2,909,800 ÷ 5,391,700 = 0.54
2 Click competitor name to see calculations.
- Revenue Trend
- The revenue has demonstrated consistent growth over the analyzed five-year period. Starting at approximately 1,031,600 thousand US dollars in 2018, revenue increased significantly each year to reach 2,909,800 thousand US dollars by 2022. This represents nearly a threefold increase, indicating strong sales expansion and possibly an increasing market share or product demand.
- Total Assets Evolution
- Total assets have also shown a steady upward trajectory, growing from 1,916,000 thousand US dollars in 2018 to 5,391,700 thousand US dollars in 2022. This growth is particularly notable between 2019 and 2020, where assets nearly doubled, suggesting significant investments in property, equipment, or other asset categories during that period. The asset growth continued at a slightly slower pace but remained substantial through 2022.
- Total Asset Turnover Ratio Analysis
- The total asset turnover ratio, which measures how efficiently the company utilizes its assets to generate revenue, has fluctuated over the given timeframe. In 2018, the ratio was 0.54, improved to a peak of 0.62 in 2019, indicating higher efficiency that year. However, it declined sharply to 0.45 in 2020, coinciding with the sharp increase in assets, possibly reflecting a lag in the revenue generated by the new assets. Subsequently, the ratio improved slightly to 0.50 in 2021 and 0.54 in 2022, signaling gradual recovery in asset utilization efficiency.
- Overall Insights
- The data indicate a growth-oriented strategy with significant asset accumulation supporting revenue expansion. Despite the rapid asset growth in 2020, the efficiency in asset utilization temporarily decreased, but it showed signs of improvement as the following years progressed. This suggests ongoing adaptation in operational management to effectively leverage the expanded asset base to sustain revenue growth.
Equity Turnover
DexCom Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 2,909,800) | 2,448,500) | 1,926,700) | 1,476,000) | 1,031,600) | |
| Stockholders’ equity | 2,131,800) | 2,251,500) | 1,826,500) | 882,600) | 663,300) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 1.36 | 1.09 | 1.05 | 1.67 | 1.56 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Abbott Laboratories | 1.19 | 1.20 | 1.06 | — | — | |
| CVS Health Corp. | 4.53 | 3.87 | 3.86 | — | — | |
| Elevance Health Inc. | 4.29 | 3.80 | 3.64 | — | — | |
| Intuitive Surgical Inc. | 0.56 | 0.48 | 0.45 | — | — | |
| Medtronic PLC | 0.60 | 0.59 | 0.57 | — | — | |
| UnitedHealth Group Inc. | 4.14 | 3.98 | 3.90 | — | — | |
| Equity Turnover, Sector | ||||||
| Health Care Equipment & Services | 3.09 | 2.81 | 2.73 | — | — | |
| Equity Turnover, Industry | ||||||
| Health Care | 1.97 | 1.91 | 1.89 | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Equity turnover = Revenue ÷ Stockholders’ equity
= 2,909,800 ÷ 2,131,800 = 1.36
2 Click competitor name to see calculations.
- Revenue
- The revenue demonstrated a consistent upward trend over the five-year period. Starting at approximately $1,031,600 thousand in 2018, it increased steadily each year, reaching $2,909,800 thousand by the end of 2022. This reflects a significant growth trajectory, with the most notable annual increase occurring between 2021 and 2022.
- Stockholders’ Equity
- Stockholders’ equity also increased substantially from 2018 to 2021, rising from $663,300 thousand to a peak of $2,251,500 thousand. However, in 2022, there was a decrease to $2,131,800 thousand, indicating a decline after several years of growth. This suggests a possible change in capital structure or distribution of earnings during the final year of the period analyzed.
- Equity Turnover Ratio
- The equity turnover ratio showed a declining trend from 2018 to 2020, dropping from 1.56 to 1.05. This decline suggests that the efficiency with which the company utilized its equity to generate revenue weakened during this period. From 2020 to 2022, the ratio improved moderately to 1.36 but did not return to the initial higher levels observed in 2018 and 2019. This pattern indicates some recovery in equity utilization efficiency but still below earlier performance levels.
- Overall Analysis
- The company exhibited strong revenue growth throughout the period, supported by increasing equity until 2021. Despite the increase in stockholders’ equity, the declining equity turnover ratio in the first part of the period indicates a diminishing efficiency in using equity to generate sales. The partial recovery in equity turnover in recent years, coupled with a slight decline in equity in 2022, may reflect strategic adjustments in asset management or capital deployment. The overall financial indicators point to a growth-oriented phase with attention needed to optimize equity efficiency and manage capital structure.